Financial Analysis: Jefferies Financial Group (JEF) and The Competition

Jefferies Financial Group (NYSE: JEF) is one of 34 publicly-traded companies in the “Security brokers & dealers” industry, but how does it compare to its peers? We will compare Jefferies Financial Group to similar companies based on the strength of its dividends, institutional ownership, risk, profitability, analyst recommendations, valuation and earnings.

Earnings & Valuation

This table compares Jefferies Financial Group and its peers gross revenue, earnings per share and valuation.

Gross Revenue Net Income Price/Earnings Ratio
Jefferies Financial Group $5.01 billion $1.03 billion 22.59
Jefferies Financial Group Competitors $6.39 billion $1.12 billion 14.31

Jefferies Financial Group’s peers have higher revenue and earnings than Jefferies Financial Group. Jefferies Financial Group is trading at a higher price-to-earnings ratio than its peers, indicating that it is currently more expensive than other companies in its industry.

Dividends

Jefferies Financial Group pays an annual dividend of $0.50 per share and has a dividend yield of 2.7%. Jefferies Financial Group pays out 61.7% of its earnings in the form of a dividend. As a group, “Security brokers & dealers” companies pay a dividend yield of 2.1% and pay out 30.1% of their earnings in the form of a dividend.

Profitability

This table compares Jefferies Financial Group and its peers’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Jefferies Financial Group 10.07% 6.70% 1.44%
Jefferies Financial Group Competitors 47.00% -76.32% 33.29%

Institutional & Insider Ownership

76.0% of Jefferies Financial Group shares are owned by institutional investors. Comparatively, 63.7% of shares of all “Security brokers & dealers” companies are owned by institutional investors. 10.0% of Jefferies Financial Group shares are owned by company insiders. Comparatively, 21.1% of shares of all “Security brokers & dealers” companies are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Volatility & Risk

Jefferies Financial Group has a beta of 1.36, meaning that its stock price is 36% more volatile than the S&P 500. Comparatively, Jefferies Financial Group’s peers have a beta of 1.05, meaning that their average stock price is 5% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent ratings and target prices for Jefferies Financial Group and its peers, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Jefferies Financial Group 0 0 1 0 3.00
Jefferies Financial Group Competitors 498 1757 1716 85 2.34

Jefferies Financial Group currently has a consensus target price of $29.50, indicating a potential upside of 61.20%. As a group, “Security brokers & dealers” companies have a potential upside of 13.12%. Given Jefferies Financial Group’s stronger consensus rating and higher possible upside, equities research analysts plainly believe Jefferies Financial Group is more favorable than its peers.

Summary

Jefferies Financial Group beats its peers on 8 of the 15 factors compared.

About Jefferies Financial Group

Jefferies Financial Group Inc., a financial services company, engages in investment banking and capital markets, asset management, and direct investing businesses in the Americas, Europe, and Asia. the company also offers equities research, sales, and trading services; equity finance services comprising financing, securities lending, and other prime brokerage services; and wealth management services to high net worth individuals, their families and businesses, private equity and venture funds, and small institutions. In addition, it provides fixed income sales and trading services for investment grade corporate bonds, U.S. and European government and agency securities, municipal bonds, mortgage- and asset-backed securities, leveraged loans, consumer loans, securities, markets debt, interest rate, and credit derivative products, as well as foreign exchange trade execution and securitization capabilities, as well as manages, invests in, and provides services to a group of alternative asset management platforms in investment strategies and asset classes. The company was formerly known as Leucadia National Corporation and changed its name to Jefferies Financial Group Inc. in May 2018. Jefferies Financial Group Inc. was founded in 1968 and is headquartered in New York, New York.

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